It's the Economy

November JOLTS Records, Plural

November JOLTS data: Two Narratives

The “Job Openings and Labor Turnover Survey” or JOLTS Survey did not used to receive very much attention. This has changed over the past one or two years as we have seen record levels of job openings reported. The current jobs report data is for December 2018. The current JOLTS report is for November 2018. What was reported isn’t quite what was recorded.

The November Jobs Report was tepidly received on Friday December 7th. The “headline jobs number” was lower than anticipated. Wages grew, just not at the employment level “wanted.” Unemployment dropped. The problem is that most individuals report on the report and not on the data. This column has already published five articles covering the November Jobs Report:

The data was good. It was made better this month when the seasonally adjusted Current Employment Statistics (CES) worker data was revised up 30,000 workers and the November data was revised higher by 42,000. This is important because the JOLTS data closely mirrors the CES data.

Four Surveys. Four different things. .The first thing that you need to understand is that the JOLTS data is one survey, the Current Population Survey, from which the unemployment data is obtained, is a second survey, and the CES data is a different survey that measures If you want to have some fun throw in the weekly continuing unemployment claims data into the mix. The JOLTS data has information on Job Openings, Separations, Quits, and Hiring. The CPS data has information on full-time jobs, part-time jobs, and unemployment without any information on sectors. The CES data has worker information by sector without any indication if the jobs are full-time or part-time. 

It is disingenuous to compare Job Openings and Unemployment levels. Total different surveys measuring different things. We do not know if these job openings are full-time or part-time jobs. You may as well try to play a DVD on a turntable.

You May have heard that Job Openings Missed Expectations – The were still a record high for November. There were 6.5 Million non-seasonally adjusted (NSA) Job Openings this November. That is up from the 5.473 million job openings last November. in Job openings tend to peak during April before dropping and peaking again during July. The annual low tends to be December of one year and January the following month/year. The most job openings were in Trade, Transportation and Utilities (TTU,) Education and Health Services (EHS,) Leisure and Hospitality (LA, H,) and Professional Business Services (PBS.)  EHS, TTU, and LAH are three of the four lowest paying sectors month in and month out. It is important to note that there are nearly a half million job openings in Manufacturing, and 278,000 job openings in construction.

We had a record level of Hires for the Month of November this year. We had 5.221 Million hires this month. How is that possible with 312,000 “jobs” added to the economy? We also had a record level of quits and separations. The sectors with the most hires were TTU, PBS, LAH, and EHS.

We had a record level of November Separations this year. We had 4.282 million separations this November, up from last November’s 4.108 million. The sectors with the most separations were TTU, LAH, PBS, and EHS. It is interesting to note that there were “no” separations in Manufacturing. There was a very slight 2,400 separations in manufacturing this month.

We had a record level of November Quits this year. There were 2.885 million quits this November. This is up from the 2.707 million quits that happened last November. Last November was a record November for quits. The sectors with the most quits were PBS, TTU, LAH, and EHS. The fewest quits were in Mining and Logging. s are

The false narrative is that the Job Openings Data is higher than the Unemployment data from the CPS data so we have a worker shortage and the potential for wage pressure.  The real narrative is that wages impact quits, separations, job openings and hiring. Three of the four lowest paid sectors have the three of the highest job openings numbers, quits numbers, separations numbers and job opening numbers. November to November participation rose. Wages rose. Coincidence?

It’s the economy.

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